Disharmonious bureaucracy hampers deregulation effort: INDEF

A lack of coordination among government institutions is the main factor holding back the implementation of the deregulation policies launched recently by President Joko “Jokowi” Widodo’s administration.

According to Institute for Development of Economics and Finance (INDEF) economist Bhima Yudhistira Adhinegara, regional governments were still reluctant to cut red tape as instructed by the central government because it would make them lose a significant amount of income.

“The central government claimed to have revoked 137 regulations, but in fact the ministries later issued new regulations with functions similar to the old ones,” Bhima said in Jakarta on Thursday during an INDEF seminar on “evaluating Jokowi’s second year”.

In spite of 13 economic policy packages recently issued, the slow implementation on the grassroots level still held back Indonesia’s competitiveness, he argued. Indonesia’s global competitiveness rank was down from 37 in 2015 to 41 in 2016.

The government’s measures have also been ineffective, Bhima said, since illegal fee collectors and rent seekers were still rampant on the regional level.

“The economic policy packages and the successful tax amnesty might make impacts in the short term, such as the stock market rally, but the longer term results, on the practical level, are yet to be seen,” he said. (ags)